You knew it was only a matter of time before we'd start hearing about the ominous holiday season.  As I continue to write about the economy's woes, a report recently came out from the National Retail Federation (NRF) stating that holiday sales are expected to rise at their slowest pace in five years.  The report blames the weak housing market and a credit crunch as the factors that will impact consumer spending.

The NRF stated that holiday retail sales are forecast to rise 4% to $474.5 billion this year, making it the slowest holiday sales growth since 2002, when sales rose 1.3%. It also would fall below the 10-year holiday sales average of a 4.8% increase.  Last year, holiday sales rose 4.4%.

THE REAL WORLD RETAILING TAKEAWAY
I'm tired of the glass always being half-full.  The pressure on retailers to outperform the economy every year during the holiday season will eventually put the category into a death spiral.  Since when can an industry outperform general economic growth year over year?

It can't.  And that's why you see retailers pulling out all the stops to ensure they make their sales goals, lest Wall Street punish their stock.  From weekend sales to one day sales to midnight madness sales to door busters, the cacophony of advertising and marketing retailers make around the holidays is deafening.

While attaining sales goals are one thing, retailers are taking a hit to their profits.  It's a double-edged sword.  Hold your prices and risk not attaining sales goals and your stock gets punished.  Discount heavily to drive traffic and attain your sales goals but miss your profit goals and your stock gets punished.

As small retailers, we're insulated from the impact of Wall Street.  But we're not insulated from the general malaise of retail.

So what should you do?  Use the NRF's 4% increase as your benchmark for holidays (the day after Thanksgiving through December 24th).  If you've been in business for a while, then 4% is a good comp store sales number.  If your store is only a year or two old, then you should still be in growth mode and easily surpass the number.

While the holiday season is a few months away, we as small retailers should be thinking about it now.  After all, for many retailers it represents up to 30% of their annual sales.

So set a goal for yourself and then figure out how you're going to attain it -- you have less than two months before holiday officially kicks in.

How are you going to reach your holiday sales goals?